Thursday, September 29, 2016

Anothe brcik removed in the housing ponzi scheme

Philip Hammond anounces end of Help to buy

One by one the props that make the UK the second most overvalued housing market in the world are coming to an end. This year we have now had a massive amount of benefits taken away from Buy to let Landlords and now Help to Buy is going from another area of the housing market. Not quite a free market yet but a step in the right direction

Posted by britishblue @ 12:57 PM (6052 views)
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10 thoughts on “Anothe brcik removed in the housing ponzi scheme

  • Those of us who have been following the housing debacle for over a decade will expect a new bigger and better scheme to be announced in the Autumn Statement on 23 November.

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  • Perhaps they could introduce “Buy to Help” – using QE to buy people’s houses at inflated prices. Now that’s an idea.

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  • Great news, but they also need to stop the Funding for Lending scheme for mortgages. And actually do something on the supply side.

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  • Housing has become an indirect private taxation, a modern version of feudal landowners charging their employees rent. It effects an increasing large amount of the electorate and a whopping 50% of Londoners. It was also a very healthy tax break for buy to letters and home owners until the government started addressing this earlier this year first with buy to let and now with the recent changes.
    For example in 2005 a friend rented a house near me. They were paying £1250 a month rent. The house is now up for rental at £2500 per month, with no structural changes, so a 100% increase in renting costs over a 11 year period. Both gross domestic product, inflation and wages have not kept pace with this. Many ordinary people who are renting would have been better of seeing the basic rate of tax go up massively rather than rent. If that had happened the money could have gone into schools, roads, etc. I suspect Hammond and May are fully aware of the additional bubble Osborne blew and have a one of opportunity to get rid of some of these schemes.

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  • British Blue, you are wrong. The structural change is millions more people!

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  • @4 exactly – it’s a privately collected tax.

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  • Libertas at 5. No I am not wrong. I was referring to the structural change of the house. e.g no extension etc. You are completely missing the point I made

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  • @5 the cost of production of housing hasn’t doubled, so why should the rental and/or price? If the constituents of bread, i.e. wheat, baking machinery, electricity, etc went up by say 20% since 2005 but the price of bread went up by 100%, there would be a criminal investigation. This obviously can’t happen anyway because there is a competitive market in supplying bread, limiting the profits that can be made. No such competitive discipline in housing. You can buy bread from anywhere in the world, but you have a choice between exactly one supplier for each home, who can charge you as much as you can afford.

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  • FLS is the killer. HTB is nothing in comparison.

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  • britishblue, actually that is not true. I work in planning, and householder applications for extensions are off the charts in volume.

    But even that is not entirely relevant. The bigger trend is a shift towards houses in multiple occupancy. Homes previously with two to three individuals now filled with six plus, in London at least. Sometimes combined with reduced housing quality including bunk beds. We are also moving towards students sharing rooms. Also, beds in sheds.

    It used to be a family to a room in Victorian London!

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